The Church of England Pensions Board announced that it plans to vote against the reappointment of directors at banks that it has identified as having “materially backtracked” on climate commitments during the 2026 AGM season.
The pension board specifically highlighted NatWest, Santander, and HSBC for its intention to vote against relevant items at their AGMs, adding that it will monitor other banks’ reporting as proxy season continues.
According to the board, its move to vote against banks over changes in their climate stance reflects its “longstanding commitment to robust governance and acting on systemic risks,” noting that its stewardship framework emphasizes that climate change, nature loss, and social instability are systemic risks that require strong, accountable governance from its portfolio companies.
Laura Hillis, the Church of England Pensions Board’s Managing Director, Responsible Investment, said:
“Good governance is the first line of defence against systemic risk. When banks dilute or abandon commitments that investors have understood as being part of the company strategy and risk management approach, it raises serious questions about board oversight, risk management, and long-term strategic resilience.”
To support its new policy the board said that it will conduct bespoke, bank-specific assessments, using tools including ShareAction’s When Banks Step Back dataset and the TPI Banking Tool to identify directors responsible for weakened climate or risk policies and assess whether governance failures represent material risks to long-term value, with plans to escalate through votes against board chairs, and/or director members of sustainability or risk committees where appropriate.
Hillis added:
“We recognise that circumstances materially change in some cases. This is not about punishing companies who haven’t been able to meet their commitments despite best efforts. This is about integrity of governance. Investors need confidence that directors will maintain consistent, credible oversight of climate and risk policies. Where that confidence is undermined, we will act.”
